The following discussion of the background art is intended to facilitate an understanding of the present invention only. It should be appreciated that the discussion is not an acknowledgement or admission that any of the material referred to was part of the common general knowledge as at the priority date of the application.
High traffic flow retailers such as convenience store retailers must have a fast counter transaction time. Unlike banks or post offices, the customer expectation is fast service.
Financial transactions normally require a number of reasonably complex validation and compliance processes to be performed by staff. Consequently staff members have generally required a high level of skill and training to perform financial transactions over the counter. This tends to run counter to the business model adopted by most convenience stores, which is focused on low level skill and training requirements and very low numbers of staff
Convenience stores are not accustomed to high levels of compliance, fraud and cash management risk. They are also not able to hold large amounts of cash in the till due to the risk of robbery.
Consequently, convenience store retailers adopt a business model where all transactional activity is incorporated into their Point of Sale systems in preference to stand-alone systems that create difficulties when balancing and reconciling store activity. System integration projects that may be able to overcome some of these problems are usually complex, expensive and time consuming.
Given these problems, convenience store retailers have used various systems for performing financial transactions, each having their own drawbacks in one form or another. These include:
1. Paper based forms—The advantage of paper based forms systems is that they are low cost. Disadvantages are that they are slow and require a high level of staff training. They tend to fail in the convenience store environment mostly due to slow transaction times and the lack of integration with Point of Sale systems. Complex training requirements means long implementation cycles; and long transaction times at the store counter means that complex financial transactions cannot be done in high traffic convenience store environments.
2. Point of sale data entry—The advantage of this form of entry is that the transaction can be completed successfully at the counter. Disadvantages are that it is slow and requires a high level of staff training. It tends to fail in the convenience store environment mostly due to slow transaction times. As with paper based forms, complex training requirements means long implementation cycles.
3. Staging the transaction with a telephone request then point of sale completion—The advantage of this system is the staging of transactions which reduces the time at the counter. The disadvantages are that the system requires extensive use of a call centre and language difficulties can make the data collected inaccurate. It fails in a convenience store environment due to lack of customer acceptance of this method, the costs of running helpdesk and the lack of integration with Point of Sale systems.
4. Complete self-service solution on an ATM or other device that can take payment—The advantage is that there is no problem with counter time. The disadvantages are high capital costs of hardware and difficulty verifying customer identity for compliance purposes. It fails in a convenience store environment due to:
high capital costs and cash collection and management costs;
the lack of integration with Point of Sale systems and long implementation cycles; and
the fact that consumers do not feel comfortable handing their money to a machine.
With the pressure on convenience store merchants to offer more extensive service offerings that are becoming available in the financial services area, such as the ability for their customers to perform complex financial transactions involving foreign currency exchanges, the training requirements for merchants and their staff alike are required to increase, which runs counter to the business model being adopted for their success.
The seminal problem that needs to be overcome is that the onus is presently on the merchant or staff member to review transaction histories of customers and decide themselves as to what is suspicious and potentially fraudulent activity and what is not in advance or whilst a transaction is in progress